Golf will emerge from the global recession stronger than ever, Arnold Palmer has told KPMG’s Golf Business Forum. The seven-time major champion received KPMG’s Lifetime Achievement Award at the event at Celtic Manor in Wales.
“I was born during the Great Depression and I’ve lived through economic recessions,” said Palmer. “We will come out of this one having learned from the experience – and we’ll be stronger.”
During the conference’s opening session, an electronic poll of delegates on the impact of the economic downturn showed 34.3 per cent saying the effects were severe, 46.5 per cent moderate, 9.1 per cent said there was no impact at all, with 10.1 per cent saying they were benefiting.
KPMG’s Andrea Sartori said: “Our poll on the impact of the economic conditions on golf businesses, albeit unscientific, echoes what is happening in other sectors of the economy. Clearly, there are challenges, but it is encouraging that more than half of golf businesses are experiencing only moderate or no impact, while more than 10 per cent are actually benefiting, including the domestic golf tourism sector in the UK. The reason for this is the weak currency combined with a cut in discretionary spending, making it more expensive to travel abroad compared to a golf break in the UK.
“From a golf resort and community development perspective, one of the biggest challenges remains the difficulty of raising finance. When financial institutions start to inject liquidity into the markets again, we will see the industry pick up – but the lack of liquidity and confidence are the two key factors in current conditions.
“Saying that, I have also spoken to investors this week who do have access to cash, enabling them to acquire developments at significantly reduced prices compared to 12 months ago. And for consumers, now could be a very good time to invest in property in places such as Spain and Portugal.”
Speaker Ray Wilson of Southern Golf said: “The current climate represents the best opportunity for developers who are willing to be strong and take a chance. The challenging global economy has driven construction prices as low as they have ever been, so build costs are that much lower. It will take a brave company to commit to a building project now, but financially it does make sense from a cost perspective.”
Palmer added that one key spur for growth would be golf joining the Olympic family. “I am very much in favour of golf becoming an Olympic sport,” he said. “I don’t think we can comprehend what it would mean to the game. From any angle, what it will bring to business, and the wider public interest it will create, it is almost mind-boggling what the impact would be.”